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Rockwell reorganises to `sharpen its focus`

01 July, 2000

Rockwell Automation is reorganising a large part of its global industrial automation business in an effort to "sharpen its focus on the marketplace". The changes, which take effect immediately, are also intended to: boost growth; respond better to changing customer demands; accelerate innovation; and simplify decision-making.

The five business groups that previously made up Rockwell`s Control Systems business are being replaced by three global operating groups:

  • Components and Packaged Applications;
  • Automation, Control and Information; and
  • Software and Services.

A key driver behind the changes is the continuing shift in emphasis from sales of hardware components to the provision of software tools and support services.

As part of the shake-up, Rockwell`s sales organisation will be revamped to accelerate growth and "to provide the needed focus to better serve our customers around the world". The only part of Rockwell not affected by the changes is its power systems business including the Dodge and Reliance Electric operations.

Rockwell chairman Don Davis says that the reorganised business will be better positioned to sell integrated architecture products, software and services. "We will be able to respond even faster to changing market dynamics and increasing customer demands for interoperable automation solutions," he adds.

Randy Freeman, Rockwell`s vice-president for global marketing, emphasises that "this is not a move to fix an ailing company". It "comes on the heels of great results," he says. (Rockwell Automation`s third quarter earnings of $1,142m were $8m up on the same period last year while the volume of its European business rose by 10%.)

Freeman adds that although the reorganisation is not intended primarily to cut costs, "there could be some consolidation", resulting in the redeployment of staff or job losses.

The new Components and Packaged Applications group will combine Rockwell`s industrial control and drives portfolios, spanning products from pushbuttons and contactors, to sensors and starters. In addition, it will provide systems integration services for applications such as printing, crane controls, and web systems. The group will also play a leading role in developing the next generation of industrial safety products.

Ted Crandall, formerly head of Rockwell`s industrial controls business, has been named as senior vice-president for this new group. One of his responsibilities will be to guide Rockwell`s global expansion through strategic alliances and regional investments.

The second new group, Automation Control and Instrumentation, will promote the global adoption of Rockwell`s open architecture including its Logix processing, NetLinx communications and ViewAnyWare visualisation families. These technologies are designed to integrate different control disciplines across a variety of operating platforms. Rockwell says that this approach will allow customers to cut costs by using a single, scalable platform for many applications.

Spearheading this group will be Steve Eisenbrown, formerly in charge of Rockwell`s Control and Information business.

The third group, Software and Services, will combine Rockwell`s software activities with an expanded service operation including product support call centres, field-based technical services, systems engineering, training and workforce productivity, asset management, and integration management. Ron Wichter has been brought in from the computer-maker Compaq to run this group.

In addition to the group appointments, Jeff Banaszynski has been named senior vice-president for European and Asian sales, while John McDermott will perform a similar role for the Americas. Keith Nosbusch will continue to lead the three businesses as Control Systems president, report to Don Davis.

Davis says that the new organisation will allow Rockwell to capitalise on opportunities to expand the business faster than before. "Combined with an aggressive e-business initiative, Rockwell Automation will be ideally structured to serve its industrial automation customers worldwide," he adds.

Joe Lupone, Rockwell`s UK sales director, says that the changes, "will have very little impact on the UK". There may be "some tweaking in the reporting structure", he adds, but he does not expect any job losses.

Lupone points out that because of the UK`s relatively small operation, the previous structure was less of a hindrance to communications than in the much larger North American business. But he sees attractions in the slimmed-down organisation which reflects the trend towards integrated architectures with products spanning the previous boundaries.

Lupone welcomes the changes in Rockwell`s global sales organisation to separate the Americas from the rest of the world. "The needs of Asia and Europe are very different to those of the Americas," he points out.

UK customers should find Rockwell more responsive as a result of the changes, Lupone predicts. "We will be able to respond quicker, with fewer internal signups," he says.

• Rockwell and Omron have formalised the strategic relationship they announced in April at a signing ceremony at Rockwell`s Milwaukee headquarters. They have agreed to adopt a common open architecture (based on Rockwell`s Logix, NetLinx and ViewAnyWare families), to cross-brand certain products, and jointly to develop and market products.

"In only three months, the collaboration between our companies has resulted in cross-branding of products, including Rockwell`s labelling of industrial control products from Omron, and Omron labelling safety products from Rockwell," reports Omron chief executive Yoshio Tateisi. "We are excited and pleased by this rapid development and look forward to further progress."




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